Corkage in British Columbia: A Consumer’s Take

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On July 19, 2012 the Liberal government legalized corkage in British Columbia. It is astonishing it took until 2012 for this minor step to be taken towards modernization. In the aftermath, there have been a number of articles and discussions on corkage, including an excellent overview from sommelier Jake Skakun.

I previously wrote a post supporting the introduction of corkage back in March of last year. However, since corkage was introduced I have refrained from comment because I feel most of the arguments have been made. Now, after about a month of experience I feel the time has come for a brief comment. What I want to do is make an argument for 1) how to educate consumers about corkage and 2) what fees are appropriate.

Many restaurants I admire and frequent have decided not to allow corkage. This is a short sighted decision and I find it astonishing that establishments that devote so much thought to food could, in good conscience, not support corkage. To me it is a failed opportunity to grow the inextricable link between wine and food in our culture and allow consumers to supplement mediocre wine lists and greatly expand the wine available to consume with some of the city’s best restaurants.

Restaurants should be marketing corkage as an opportunity to bring a special bottle that is not on the list. Most restaurants now provide this information as a type of warning, which turns consumers off and makes restaurants appear snooty. Rather, restaurants should be marketing corkage as an opportunity to try out cool wines and foster enthusiasm for wine and food pairing in their customers. More often than not, great corkage service will lead to further liquor sales in house (many who participate in corkage also buy bottles from the wine list).

Corkage is also an opportunity for restaurant staff to taste some unique and amazing wines, all at no cost to the restaurant, thus enhancing staff and industry knowledge of wine. It should also be a wakeup call for restaurants with lazy wine lists to step up their game.

The line I always hear is that restaurants want to protect their revenue stream. This is, of course, reasonable. However, by disallowing corkage or by charging exorbitant fees, restaurants are doing themselves a disservice. Corkage should reflect the level of restaurant. $20-$25 makes sense for fine dining at an expensive restaurant. Even $30-$35 makes sense at the city’s most expensive restaurants. However, it is perverse in a consumer’s mind for casual restaurants charging between $13-$23 for entrees to be charging more than $15 corkage. However, almost no restaurants in Vancouver currently hit the $10-$15 sweet spot.

Restaurants will continue to defend this practice with unfounded fears of Yellow Tail populating their restaurant. A look at any other city in the world where corkage is legal shows this is hardly much of a risk. First, ethnic restaurants will gladly take that business by offering free or close to free corkage. Second, most people will not bring their own wine out to eat unless they are really into wine. Thus, in most cases, by offering corkage at a reasonable fee (and providing excellent glassware and wine service) restaurants are merely providing better service to their best customers and will likely win loyalty.

Restaurants will also claim that liquor margins are at risk if they lower their corkage fees. In the end it is a question of balance rather than flat out refusal. What sort of corkage customers do you want at your restaurant? What opportunities can you create by offering this service? How many customers will really spend less on corkage (pure profit without inventory costs) versus the profits you would make in house? Good restaurants obviously already do this sort of math. However, it seems to me that irrational fear has taken over at quite a few establishments.

It is time to end the fearful practice of rejecting corkage and fully embrace the great opportunity this is to broaden and enhance Vancouver’s wine culture. Corkage is the first step in introducing significant change to B.C.’s wine market, both in consumer attitudes and knowledge and in government regulation. In my mind, it is also an important step to diversifying selection and attacking the uniformity of wine lists that are so predominant in today’s market. Let us turn corkage into an opportunity to build wine culture for all rather than erect walls only the elite can bypass.

Comments

  1. Ron
    August 19, 2012

    Hi Shea,

    As you know, up until about a year and a half ago I had lived outside of Canada, and did so for close to 20 years — mostly around NYC. During all that time I brought many a bottle of wine with me to restaurants and never paid corkage. These were good to excellent restaurants. Some did not have a liquor license (by choice,) others did. But any restaurant I frequented that allowed BYOB did so without any charge. To tell the truth, I didn’t even know what a corkage fee was until I moved to Victoria — never heard of it!

    I’ve come to know many restaurant owners over the years, and most say they maintain a wine cellar primarily as a service to their customers and/or prestige — very few say profit. If I was told once, I was told a hundred times, the margins on food are far higher, and inventory costs are insignificant, when compared to wine — even if they serve Russian caviar…. Good restaurants can have wine sit on their shelves for months, if not years, before it sells. And this is where wine costs much less than in BC.

    I have never lived anywhere else where most everything involving wine, or for that matter all forms of liquor, create such a fuss. It’s just another food, after all, and it’s not as if we have fewer alcohol related social problems (ie., Stanley Cup riots of last year, drunk driving, etc., etc. etc…) with the prevailing ultra high taxes and what I will call parochial, prohibitionist attitudes.

    One final comment, and this pertains to those ultra high tax rates, otherwise disingenuously called “mark-ups,” that are applied to all liquor products. I’ve been told more than once that these taxes help pay for the medical system. Well, that might be true, but why is it that since moving here in January of last year, my wife and I have not been able to find a personal doctor? This is the first time we have ever been without one. We enjoy good quality wine daily, so I dare say we pay our fare share of taxes, perhaps more than average, and for what? Good system of health care we have here… Need I say more?

    Cheers!

    Ron

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